Cadogan Petroleum PLC (LON:CAD) shares jumped on Wednesday following news late yesterday that initial drilling results of the Blazh-10 well on the Monastyretska license, in the west of Ukraine are “encouraging”, although costs were higher than budgeted.
The London main market listed independent, diversified oil and gas company said cores taken from the upper part of the Yamna sandstones and a preliminary interpretation of the open hole logs suggest that the entire section could potentially be oil bearing.
The group pointed out that the drilling encountered 207 metres of the Yamna target formation, at a depth 50 metres higher than prognosis and in the predicted sub-vertical setting.
It added the well is being conditioned to run and cement a 7” casing, which will be followed by well testing, with full log interpretation and testing results to determine the net pay and the expected deliverability of the well.
The company noted that the well reached its target depth of 3394 metres at a cost which was 10% higher than budgeted due to severe hole instability challenges which were experienced while drilling.
Guido Michelotti, Cadogan Petroleum CEO, commented: “The initial results of Blazh-10 are encouraging; we look forward to testing the well and providing further updates on progress. The well is a testimony to Cadogan’s operational excellence and creates a local benchmark as it has been drilled in about a fifth of the time taken to drill the fastest of the nearby wells and some 10% of their average time”.
The group said further updates will be provided in due course.
In early trading on Wednesday, shares in Cadogan Petroleum was the London market's top gainer, up nearly 24% at 14p.
-- Adds share price --